Student credit cards: What are the best cards with no annual fee? Check details

If you are a student, being unemployed and having no credit history can be a barrier to obtaining a credit card. However, there is a way to get one. Generally speaking, there are two options for a student to obtain a credit card: the first is to obtain a supplemental card to a parent’s primary credit card, and the second is to obtain a credit card against a fixed deposit (FD) account.

Most banks offer these credit cards and interestingly, these cards have no sign-up fees. Let’s understand more about this here:

The student credit card offers a variety of benefits. These include:

A. Build credit score: This helps you build a good credit score which is vital to obtain a loan later.

B. Rewards Points: Most student credit cards help you earn rewards points with every purchase. These points can be redeemed for cash, vouchers and airline miles.

C. Emergency Financial Backup: This also provides credit card holders with financial backup during emergencies.

Types of credit cards for students

There are two ways to issue student credit cards. One is a supplemental card issued to a primary credit cardholder. Allows you to share most of the benefits of the main card without the need to pay a separate registration fee or annual fees.

Parents can provide this as financial convenience for children and it is helpful in times when they need to manage expenses on their own. The second option is to give a credit card against fixed deposits (FD).

Credit card against fixed deposit

Some banks offer credit cards against fixed deposit accounts. The credit limit for such cards is usually a percentage of the funds in the FD (90 percent of the FD amount).

Eligibility: Typically, the only credit card eligibility for students is their age, since they have no monthly income or credit score. The minimum age to obtain a credit card is 18 years old, but it may vary from bank to bank.

The documents required for a valid student credit card are a valid ID, proof of address, a passport size photograph and other documents required by the bank.

Some of the credit cards offered for students:

IDFC First Bank Wow Credit Card: IDFC First Bank offers FD backed secured credit cards. This requires no credit history or proof of income. The minimum age criterion to apply for this credit card is 18 years. These cards have features like no Forex conversion fee, 4X rewards points on spending, and an ATM cash withdrawal limit of 100 percent of the FD value.

ICICI Bank Student Credit Card: ICICI Bank offers the option of purchasing a student credit card against a fixed deposit (FD) guarantee and an add-on card. The FD must have a minimum value of $50,000. A student credit card generally does not include annual or registration fees, the ICICI Bank website reveals.

Axis Bank Student Credit Card: Axis Bank also offers credit cards without proof of income, i.e. student credit cards. The paperwork for a student credit card is much simpler than that required for a regular credit card. credit card.

These cards are issued on the basis of educational loan approval, mainly the credit history of the cardholder and on the basis of FDs maintained in the bank. Furthermore, only KYC documents and age proof documents proving that the student is above 18 years of age are required.

Most student credit cards have a small credit limit of $15,000 and are valid for five years. And when it is an add-on card, the credit limit is linked to that of the main card and in an FD backed card it is linked to the FD amount.

Kotak Mahindra Student Credit Card: These cards are offered with no annual fees, interest-free cash withdrawals, and double rewards. These cards are known as the 811 #DreamDifferent Credit Card. This can be set up through a fixed deposit in Kotak Bank and can be operated without an annual fee.

This helps them get a credit card even when they don’t earn. The credit limit is up to 90 percent of the fixed deposit amount and is known in advance at the time of application. The high credit limit is up to $16 lakh.

Student credit cards issued by state governments

West Bengal Student Credit Card Scheme: Under this scheme, students from the state of West Bengal can pursue secondary, higher secondary, undergraduate, postgraduate and professional degree courses in an affiliated institute.

The scheme is also available for students studying in training institutions for various competitive exams in public administration, engineering and medicine, among other fields.

Bihar Yojana Student Credit Card: Under the Bihar Student Credit Card Scheme, students staying in Bihar can get an education loan of $4 lakh at 4 per cent interest. For students with disabilities, women and transgender students, the interest is only 1 percent.

A student who wants to pursue a bachelor’s degree can apply for this scheme. The scheme is valid for students residing in Bihar and below 25 years of age. They should have completed higher secondary education or secondary education in the case of a polytechnic degree.